Revlayer introduces controversial new video ad format

Revlayer is a New York company that just launched a controversial new video advertising technology that publishers will love, but video creators might hate.

It lets a publisher like VentureBeat slap an ad straight onto the top of a video, which readers will see before they even press play to see the video. See example below (RSS readers won’t be able to see the example, so you’ll have to click through, or see another version here).

So we could draw in a video from say, AllthingsD.com, a property of Dow Jones, and show it to our readers — making money from the hard work of Dow Jones employee Kara Swisher who makes such videos (we’ve embedded her videos in the past). But wouldn’t we get an aggressive cease-and-desist letter from Dow Jones’ lawyers?

Founder Allen Stern, 33, who has hooked up with two other developers, says he doesn’t think so. As a publisher of a site, we have the right to monetize content as we see fit, he says. By simply overlaying an ad on the video before we play it, there’s no manipulation of the video itself, he points out. Besides, if we’re sending traffic to Dow Jones and they make money, shouldn’t we be allowed to as well?

As you’ll see below, you hit the close button on the top right, and that closes the ad. You can then press play to start the video.

We’re surprised no one has thought of this before.

Stern said he is working to give publishers a way to customize the ads overlays, giving them their own backgrounds, or logos.

He also is working on ways to make it clearer that the overlay is an ad and that people need to close it to get to the video.

The company launched earlier this week under the name Prerollr, however quickly changed its name after some feedback from users who didn’t like the name. Conventional pre-roll ads have a negative connotation, he said, and besides, the Revlayer ad isn’t the same as the pre-roll ad as conventionally understood: These are ads that runs for a few seconds after someone hits play to start the video. (They are called pre-roll because they run before a video’s main content.)

The company has no funding.

The service offers two options. The first lets smaller sites access Revlayer’s network of advertisers (it has few advertisers now, if any, but it is now turning to fix that). Sites would share revenue with Revlayer.

Larger sites could bring in ads from relationships they already have. They would deliver these ads 75 percent of the time and enjoy full revenue from those ads. Revlayer would deliver its ads 25 percent of the time.

He said several hundred sites have already signed up for the technology already. You can do so here.

Once you place its code into your blog, the ads go on top of all of your archived videos.

Right now, the technology supports videos on players from YouTube, Veoh, Google, Videojug, Viddler, Revver, MySpace TV and many more (full list at bottom of page here). However, Revlayer can customize its technology to work with other players, too, such as the one from AllthingsD.